Exchange 2010: Helpful or Harmful for Third-Party Vendors?

As with any new software version, Microsoft has added features to Exchange Server 2010 to make it more attractive to customers and give them more incentive to upgrade or switch from other vendors' products. But as is also typical, some of these features start to encroach on territory traditionally covered by third-party vendor products. The most notable example with Exchange 2010 is probably the new built-in email archiving functionality. The upside of this development cycle is the possibility for organizations to deploy Exchange with less need of additional support products and thereby save money. But that's not necessarily good news for the suppliers of those products.

Or so I thought, until I spoke with some of the vendors that currently have products that Exchange 2010's new features encroach upon. Robert Haaverson, CEO and CTO of Imanami, a company that provides group management features, talking about Microsoft's new release cycle, said, "The biggest innovations always come during these times." Haaverson takes new Microsoft developments as a challenge to improve Imanami's offerings. "It forces us third parties to build bigger and better things faster. We definitely can stay ahead of them. That's what third parties do," he said.

Exchange 2010 introduces new group management features such as the ability for end users to create and manage distribution groups. Commenting on this point, Haaverson said, "There's a gap between what \[Exchange\] 2010 does and what our product does. In other words, our product doesn't do everything that 2010 does. But there's a bigger gap between what 2010 does and what we do, meaning that our product does a lot of other things that Exchange 2010 can't do. So for a third-party vendor, it forces you to fix your negative gap—the part that they're ahead of you on—it forces you to fix that part first, and then build bigger and better things that go beyond their functionality."

Several other vendors I've spoken with have echoed Haaverson's stance. On one hand, Microsoft provides a new competitor, while on the other hand that competition provides impetus for innovation. Frank Mitchell, product director for Metalogix, said, "Microsoft's a huge partner of ours. It's not an adversarial discussion." But at the same time, Mitchell points out that Exchange 2010's email archiving feature isn't really a match for what Metalogix already offers. "You don't want end users deciding what an archive is for themselves. There's a chain of custody discussion there, there's the ability to search that. I think there are limitations to the archive in 2010," he said.

Of course, the email archiving feature being introduced with Exchange 2010 isn't as fully featured as what you would find from any number of third-party vendors. In fact, the way Microsoft has implemented this feature, it really just appears to be a means of getting around the use of PSTs. It's controlled by end users, but the archive file is stored back on the same Exchange server, rather than on users' local drives. This architecture makes for easier backup and discovery, but critics say the extra data stored on the server can lead to reduced performance.

According to Ian Hameroff, a senior product manager with Microsoft, "We have a very strong belief that our customers get the best experience when the mail data is in Exchange. And our approach for archiving and retention and discovery keeps all that mail data in Exchange so we can deliver that full fidelity user experience and administrative experience. But at the same time, we also recognize that there may be some things that we don't do to the same extent, especially for complex compliance scenarios or regulations."

Hameroff and others at Microsoft continue to stress their commitment to working with third-party vendors to support Microsoft products. It even appears that there's a certain amount of planning for third-party support that's gone into the development of Exchange 2010. As Hameroff said, "We have our foundational capabilities built in to the product, and we have APIs that we're shipping—and we'll be shipping additional ones in subsequent milestones—that allow these third-party products to plug in and build on top of Exchange 2010."

So for the time being, Exchange 2010's built-in archive doesn't appear to be a serious threat to third-party email archiving vendors; other product areas might have somewhat greater challenges. Nonetheless, vendors and software developers who take on this challenge and use it to push their products forward, should continue to thrive. Most importantly, the ones that listen to their customers—the Exchange professionals in the field—and cater to their needs, should stay a step ahead of Microsoft in this constant chase.